Without Conceptual And Structural Clarity, Smart Cities Will Remain A Dull Plan

Broadly, it has talked of an identity crisis for the mission, failure of cities to secure funds, uneven project implementation and governance shortcomings in Special Purpose Vehicles (SPV).

Launched in 2015, the Smart Cities Mission sought to upgrade and elevate infrastructure, living standards, environmental quality, and innovation across 100 cities, which were selected through a competitive process. Over five years, the mission was to facilitate funding and provide technical support for area-based projects and pan-city initiatives in the chosen cities.

In view of the parliamentary panel's observations and recommendations to the Ministry of Housing and Urban Affairs, The Secretariat seeks to delve deeper into the problems plaguing the Smart Cities project and explores potential solutions -- in continuation of an earlier article that had compared India's infrastructure programmes and the structural issues they faced.

Conceptual Gaps:

Asked by the committee to define the mission, the Ministry explained that SCM mixes elements of AMRUT, which primarily targets water, of Swachh Bharat that focuses on sanitation, and the National Urban Livelihood Mission (NULM), which targets livelihoods.

The SCM’s character thus becomes liminal when compared to the other three schemes, which are nationwide or for small towns. Clear goals are far more effective than adopting a vague and flexible approach.

On being asked further for defined boundaries, the Ministry said SCM operates on three core principles: sustainability, liveability, and economic viability. Coincidentally, the government has never defined the Smart City Mission. Similarly, on project principles, the ministry stressed on citizen-centric projects in each city's context, with 100 cities chosen over three years based on local stakeholder inputs.

With minimal funding from cities themselves, SCM projects decidedly stray from the aim of decentralisation of local bodies as provided under the 74th Amendment. This casts a shadow on the SCM’s claim of tailored projects since it is mostly the state government which decides what is tailored for a city, for example.

Implementation Hiccups

The SCM comprises two project types: pan city and area development. While area-level strategies have gained traction in urban development, their execution is not aligned with land use or master plans, resulting in fragmented spatial plans and conflicting projects.

As much as 56 per cent of funds are for area-based development, but it is unclear how they fit into broader city plans or contribute to a unified urban development strategy, as the ministry has yet to provide clarity. Similarly, the remaining 44 per cent of nationwide projects raise questions about their alignment with city plans and contribution to a cohesive urban strategy. 

Coherence and alignment within planning frameworks are crucial for sustainable urban development, and without integration, conflicting visions may derail the ambitions for smart cities. Stakeholders must prioritise robust planning and strategic alignment to address these challenges effectively.

Frequent Changes

Data analysis has pointed to some trends of concern. Cities which had planned for 5,151 projects are now undertaking 7,970 projects, with notable spending deviation.

Of the 100 cities, 70 have taken on more projects than anticipated, the rest have pursued fewer. However, the increase in project count hasn't proportionally translated into spending, with costs lower than estimated.

The Ministry attributes city-wise variations to implementation challenges and cites an advisory that permitted project variations. Nonetheless, concerns remain about transparency and accountability in project modifications.

Cold Shoulder For Core Infrastructure

The mission aims to transform urban areas by integrating smart solutions into core infrastructure. Recent data has revealed a decline in focus on core infrastructure projects. By May 2023, an investment of Rs 1,70,400 crore had fuelled 7,864 SCM projects. Yet only 5,754 projects worth Rs 1,27,576 crore were oriented towards core infrastructure.

The MoHUA emphasises the importance of tailoring Smart City Plans to reflect each city's unique character and aspirations. However, concerns emerge on the neglect of essentials like roads and water.

Barring 13 cities, the others have allocated more than 50 per cent of their resources for core infrastructure. MoHUA defends this as flexibility but doesn’t have an answer for leaving fundamental urban challenges unaddressed. 

SPV Model Not Ideal

The SCM mandates creation of SPVs under the Companies Act, 2013, with 50:50 ownership between Urban Local Bodies (ULBs) and respective states to execute development projects. Concerns have been raised over SPVs potentially diminishing the ULBs' authority.

While most SPVs were established within the stipulated time-frame, exceptions like New Town Kolkata exist. SPVs are intended to streamline decision-making for citizen-centric development, but issues of power dynamics persist.

The Ministry has issued guidelines for SPV HR policies to accommodate varying city capacities and contexts. Furthermore, ongoing research aims to evaluate SPV performance and its impact on project implementation capacity, particularly in smaller cities.

Different Capacities

Disparities in Smart City project implementation reveal varying performance levels across the board. The report's Annexure IX says Surat, Agra, Ahmedabad, Bhopal, Varanasi, Madurai, Ranchi, Pune, and Indore stand out as top performers.

Progress has been sluggish in other cities, including those in the North-East, despite altered funding patterns. As of December 2023, the top 20 performing cities averaged only 6 per cent incomplete projects, but in the bottom 20 cities, nearly 47 per cent projects were still at work order stage.

MoHUA blamed the delays on convergence projects involving agencies beyond the Smart City domain, resettlement/rehabilitation issues in housing and market redevelopment, and challenges in projects like Smart Roads that require extensive underground cabling and utility laying.

No Exchange Of Learning

The lack of cross-city reference or cross-learning in the SCM has prompted inquiries about mechanisms in place to facilitate mutual learning. The Ministry outlined several initiatives to address this concern, including Sister Cities programmes that pair better performing cities with ones lagging.

The SAAR initiative with premier planning colleges to document case studies, and the India Smart Cities Awards Contest (ISAC) which recognises exemplary projects were also cited.

Additionally, conferences, workshops, and monthly meetings provide platforms for peer-to-peer learning at both state and national levels, with SmartNet serving as an online repository. The 'Pairing of Smart Cities' discussions, project details exchange, site visits, and sharing of best practices were hindered by the Covid-19 pandemic, diverting focus to pandemic response efforts.

The Way Forward

The issues identified span multiple levels, ranging from misalignment of projects with city strategies to lack of representation of elected officials and unaccounted power given to companies within SPVs. Critical points discussed included emphasis on core infrastructure projects, cross-learning, and improved financial devolution and management. Here's a summary of the essential recommendations made by the committee.

The committee found frequent changes or shelving of projects during implementation, despite the selection process based on cooperative and competitive federalism. The Ministry attributed these changes to on-ground challenges like land availability, litigations, and regulatory issues, exacerbated by the Covid-19 pandemic.

The Ministry issued an advisory in January 2019 to allow flexibility in project modifications while maintaining core values. While appreciating this flexibility, the committee also emphasised on the completion of projects on time.

The frequent transfer of CEOs of SPVs without guidelines for their tenure has been found to be a major challenge. The committee recommended appointing CEOs with fixed tenure and establishing a robust governance structure for SPVs, including representation from city administration, local self-government, urban development experts, and stakeholders to ensure accountability, decision-making, and transparency.

The emphasis was on the greater involvement of public representatives in SCM execution. While guidelines outline a consultation mechanism through the Smart City Advisory Forum (SCAF), forum meetings were irregular in many cities with some cities not holding any at all. The lack of engagement thus led to delays and changes in project completion across various Smart Cities. The committee suggested Members of Parliament should be included in both city-level and state-level advisory bodies to leverage their expertise and grassroots connections. It also recommended regular SCAF meetings quarterly or twice a year with MPs for discussions and inputs.

Further, there is a greater need for pan-city projects that implement technology-driven solutions city-wide to address common challenges faced by all residents. 

As of December 2023, pan-city projects were less than 50 per cent of total projects in 76 of the 100 smart cities, underlining the need for more focus in this area. The committee recommended giving adequate emphasis to pan-city development to ensure comprehensive urban development.

The Smart City Mission confronts a myriad of challenges spanning various scales, from its conceptualisation to the details of project implementation. This encompasses the allocation of financial resources, the equitable distribution of projects among cities, and the critical hierarchy of prioritisation.

Moreover, it faces the ongoing dilemma of representing public interests effectively. Overall, the mission stands at a crucial juncture, requiring significant reinvention to catalyse the transformation of urban India.